Czech Finance Minister proposes increasing mortgage tax deductions

Czech Finance Minister Alena Schillerová has proposed increasing the maximum annual tax deduction for mortgage interest from 150,000 CZK to 200,000 CZK. The measure is intended to assist young people under 36 who are currently managing or considering mortgages.

If implemented, the change could take effect as early as 2027, with tax savings becoming apparent by 2028. For those with mortgages arranged before 2021, the current limit remains at 300,000 CZK. Under the new proposal, the maximum annual tax saving for those with newer mortgages would rise from approximately 22,500 CZK to roughly 30,000 CZK.

Economists have expressed skepticism regarding the proposal's effectiveness. Analysts suggest the impact on individual households would be minimal, amounting to a maximum saving of about 600 CZK per month. Furthermore, experts warn that the measure could cost the state approximately 1.5 billion CZK annually, potentially increasing the budget deficit and contributing to inflationary risks.